Rajan's successor soon, no panel to look for new RBI chief

His term comes to end on September 4

The government will announce the successor of outgoing RBI Governor Raghuram Rajan well in advance and there won't be any search panel to look for the new chief of the central bank, an official source said.

"It (announcement of new Governor) will happen reasonably in advance. We don't want unnecessary speculation," said a top government source, adding that "the process of selection is already on".

Rajan's term comes to end on September 4.

The source also said the government will not be setting up a search panel for selection of the new Reserve Bank Governor.

Buffeted by political attacks coupled with unending speculation over his continuance, Rajan on Saturday announced that he would return to academia after expiry of his term on September 4, putting to rest all speculation over the issue.

"...On due reflection, and after consultation with the government, I want to share with you that I will be returning to academia when my term as Governor ends on September 4, 2016," Rajan had said in a message to the RBI staff.

Soon after the announcement, Finance Minister Arun Jaitley in a Facebook post lauded Rajan saying the government appreciated the "good work" done by him.

"Dr Raghuram Rajan has announced his intention to go back to academics at the end of his current assignment. The government appreciates the good work done by him and respects his decision," he had said, adding a decision on his successor would be announced shortly.

Stocks and rupee on Monday took an early morning plunge on Rajan's no to a second term, but soon recouped their losses on hectic buying by some institutions and soothing voices from rating agency Fitch and some prominent marketmen while fading Brexit worry helped too.